The Labor Market into the Third Quarter
The Seventh District states (Illinois, Indiana, Iowa, Michigan and Wisconsin) experienced a faltering labor market in the second quarter of 2011, with little or no positive momentum going into the third quarter. According to estimates of the Bureau of Labor Statistics, monthly average employment growth slowed to 7,000 per month during the second quarter, from 53,000 per month during the first quarter. In addition, potential job seekers tended to see little improvement in job opportunities; the labor force size (which includes both those who are employed and those who are actively looking for work) continued to decline in the second quarter and into June. And as evidenced by rising initial claims for unemployment insurance, layoffs and job elimination accelerated modestly.
In contrast, the Monster Employment Index, which is a survey of employer job postings online, continued to report improved labor demand from the first quarter and into June.
The “hiring” component of the ISM (Institute of Supply Managers) Index, reflecting the manufacturing sector, continued to show strength with an index reading above 50. However, the index number softened throughout the second quarter. While manufacturing continues to grow, interruptions related to the Japanese earthquake and tsunami continued to restrain production activity in the second quarter. However, according to the latest reporting of the District Summary of Economic Conditions, “contacts expected the recent slowdown would be temporary with conditions expected to rebound in the coming months.”
1. Seventh District's labor market indicators — First half of 2011
** Encompasses the District plus Ohio, not including Iowa
Note: Red indicates declien over previous quarter, or over previous quarter average.
Sources: Bureau of Labor Statistics adn Haver Analytics.